Crude oil's rally in recent months has no solid footing. It's been based on two things: people thinking oil hit a bottom, and people getting excited about the OPEC meeting on a production freeze. Only one of these makes any sense, and the fundamentals in the oil industry are still very poor.

1. The OPEC meeting is unlikely to see a production freeze, lets face it. And even if it does, Iran will refuse to freeze production. Oh, and Saudi Arabia said a production freeze hinges on Iran...

2. Production still way outstrips demand.

3. Even if there is a production freeze, it won't take long for people to realise that this won't narrow the supply/demand spread unless demand increases significantly and supply decreases, neither of which are looking very strong.

4. Russia's oil output reached a post-Soviet high in March at 10 million barrels a day.

Oil has no reason to be having this rally. I would short this with a profit target of the low £30 prices or maybe even further. I think if we see moves below $30 we could see moves back down to the lows of $26 again due to the 'psychological' level.